The U.S. Securities and Exchange Commission (SEC) has created a Cross-Border Task Force within its Division of Enforcement to address fraud affecting U.S. investors. The task force will focus on foreign-based companies, investigating schemes such as “pump-and-dump” and “ramp-and-dump,” and scrutinizing gatekeepers like auditors and underwriters. It will also review risks tied to companies from jurisdictions with heightened investor concerns, including China.
SEC Chairman Paul S. Atkins emphasized, “We welcome companies from around the world seeking access to the U.S. capital markets. But we will not tolerate bad actors – whether companies, intermediaries, gatekeepers or exploitative traders – that attempt to use international borders to frustrate and avoid U.S. investor protections.”
Chairman Atkins further stated that he has directed other SEC divisions, including Corporation Finance, Examinations, Economic and Risk Analysis, Trading and Markets, and the Office of International Affairs, to consider measures such as new disclosure guidance and potential rule changes to better safeguard U.S. investors.
Division of Enforcement Director Margaret A. Ryan added, “The Cross-Border Task Force will leverage the Division of Enforcement’s resources and expertise to combat international market manipulation and fraud. We are pleased to be part of this critical effort to enforce the federal securities laws and protect U.S. investors.”
